Super changes puncture hysteria balloon

God knows what the Australian business media loon pond will make of them, but today’s announced changes to superannuation do not add up to great deal. Property has been ignored sadly and there is some tightening of benefits for those with assets over $2 million. None of the changes are retrospective. The measures will save $900


SMSF property on the block in super reforms

From the AFR this morning: …former Labor superannuation minister Nick Sherry has listed the generous compulsory contributions for federal public servants as one of three areas of superannuation he says are no longer sustainable. Mr Sherry, who stepped down as minister in December 2011 and is now a consultant and corporate adviser on retirement incomes,


Is a $250k household poor?

Apparently, yes. Poor enough to feel sorry for yourself anyway. From The Age today: Former chief whip Joel Fitzgibbon has joined other Labor MPs concerned about the prospect of taxing the superannuation earnings of the wealthy. After the Prime Minister, Julia Gillard, again refused to rule out such a tax, Mr Fitzgibbon feared Labor might


The future of retirement

By Leith van Onselen HSBC earlier in the week released a detail survey entitled The Future of Retirement: A new reality, which analyses global retirement trends. The survey findings are based on a representative online survey of 15,000 people in 15 countries, and covered people of working age (25 and over) and those in retirement. The


Will the young save for when they’re 80?

The Association of Superannuation Funds of Australia (ASFA) invited from Prime Minister Paul Keating to give an address at its national conference. His topic was: “The future of super: Does retirement income public policy and the design of the super system need to move in a new direction?” Keating focused on the longevity risk and


Treasury softens up SMSF for regulation

  By Chris Becker The Treasury has added to the campaign to take the “self” away from Self-Managed Super Funds (SMSF or DIY) with some very interesting comments coming out Association of Superannuation Funds of Australia conference yesterday. From Fairfax: THE head of the federal Treasury has warned that self-managed super funds have become so popular that


ATO backs off an SMSF property crunch

In November 2011, a draft tax ruling (TR2011/D3) by the ATO caused concern among Self Managed Superannuation Fund trustees and property investors in particular.  The ruling suggested that the pension tax exemption ceases automatically upon death (unless a reversionary pension was in place). Under those proposed rules, if an SMSF member died with any assets, including a


Simply stupid superannuation

By Chris Becker Superannuation is one of, if not the most difficult financial constructs of the modern age. Forget collaterised debt obligations, interest rate swaps or contracts for difference. The complexity involved for what should be a simple proposition – save some money for retirement so the government doesn’t have to – has boiled over in


Is super for saving or speculating?

APRA recently released its latest annual results on the performance (for year ending June 2011) of non-self managed superannuation funds, i.e the retail, industry and corporate super funds, which represent about 2/3rds of total superannuation “savings”. Strikingly, the value and number of self-managed super funds (SMSF) has increased, the latter by 7.2% whilst the remaining


Weekend Musing: getting super right

This is a guest post from long time reader Jackson, who I have been in correspondence with since I started my articles on superannuation. The following analysis was done completely independently of my own research: There has been a lot of recent chatter about the asset allocation of superannuation, with an emerging contrarian view that


No super for you (updated)

With the end of the calendar year approaching and with the market still oscillating around its lows, super funds are scrambling to put a good light on their meagre returns. The news today for non-self managed funds was foreboding: Research firm Chant West estimates that the average fund will have shrunk in value by around


In super, the tortoise always wins

We all bemoan the state of our super when we open our statements each year particularly given the rolling ongoing crises that beset the share market. Yet the common wisdom is to always look to the long term and eschew focusing on the short term gyrations. You’ve likely heard that to fund your retirement, your


Tackle risk for super returns

Yesterday SuperRatings issued its September results for Australian superannuation funds. September continued the poor performance of this year, with year to date returns for a balanced fund of minus 4.88%. Eighty percent of investors have their super in a balanced fund so the pain is widespread. It doesn’t get much better when we look at


How safe is your super?

As the Great Moderation passes by and the Great Volatility takes its place, the investing world is glacially facing up to the fact that a return OF your money is just as important as a return ON your money. The past 30 years have allowed all and sundry to “fuggedaboutit” or “she’ll be right mate”


Relying on stock market averages

In my research putting together my articles on Asset Allocation in Super, I’ve collated the data that supports the thesis that investing in Australian shares is not as lucrative as the financial industry would have you believe. The standard industry myth is that the stock market provides 9% returns on average. I’ll quote broker Marcus


The problem with asset allocation

What is asset allocation and why discuss it? Surely super is all about putting money away for retirement: how hard can that be? In this post, I will outline the conventional thinking regarding asset allocation and why it’s mostly wrong. The empirical evidence regarding this contention is overwhelming and stark. The major academic theories that


A super question (updated)

Reader, Bamboozled, recently left a comment on my “Trouble with Funds Management” post, asking what direction to go with her super: I’m a 30 something trying to consolidate a sizeable sum spread across 4 funds into something that resembles a reasonable super bet. At the most basic level I have 2 lots of dosh in corporate


The trouble with Super

After my article on the fund management industry, I’ve received many requests from regular MacroBusiness readers for an in-depth analysis of superannuation. In my former career as a financial planner and portfolio manager, I found myself almost exclusively specialising in superannuation, particularly asset allocation. This was mainly by design as the majority of clients within the financial planning


Transitional Planning for Boomers

Readers of MacroBusiness have turned my attention to a recent “AskNoel” question on Domain from 2 (early) baby boomer investors. Q. I’m 48 and my husband is 55. As a result of renovations blowing out to $300,000, our mortgage is $690,000.  Our home is worth $1.1 million. We have two positively geared investment properties, owing


Dutch Disease hitting super returns

Exporters and import competing businesses are both suffering at the moment under the weight of the Aussie’s massive rise since the beginning of QE2. But this got me thinking about our collective superannuation and where it is invested. All Australians contribute to superannuation and while some manage their own, for the most part super is